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Court of Appeal ‘fixes’ PAD applications

When a defendant fails to comply with its obligations in respect of disclosure, claimants often resort to the court and issue an application for pre-action disclosure (PAD). These applications are not uncommon in claims pursued through the EL/PL low-value protocol.

However, where the defendant had provided disclosure prior to a PAD hearing but disputes the amount of costs sought by the claimant, the position has been less certain, with parties effectively ‘horse trading’ over the appropriate figure for costs. This has led to inconsistent awards being made by different courts with some judges applying fixed costs and others summarily assessing them on the standard basis. The Court of Appeal has now helpfully clarified the position.

In Caren Sharp -v- Leeds City Council the Court of Appeal unanimously determined that the regime for fixed costs provided by section IIIA in part 45 of the Civil Procedure Rules (CPR) for claims which start, but no longer continue under the EL/PL low-value protocol, applied to the costs of an application under section 52 of the County Courts Act 1984 for PAD.

On 26 February 2014 the claimant, Miss Sharp, tripped and fell when walking along a footpath owned by the city council and alleged that her accident had been caused by a broken paving slab. She submitted a claim notification form (CNF) through the portal on 28 October 2014. The claim subsequently fell out of the portal because of the city council’s failure to respond and the CNF was then treated as a letter of claim. The council failed to effect disclosure and the claimant made a PAD application.

By the time of the PAD hearing the council had complied with its disclosure obligations, it was only the cost element of the application which remained in dispute. DJ Heppell awarded costs to the claimant and summarily assessed them on the standard basis in the amount of £1,250.

On appeal HHJ Saffman came to the opposite conclusion and determined that the fixed costs regime (within the meaning of part 42.29H) applied to PAD applications, and allowed costs of £305.

Before the Court of Appeal it was argued, on behalf of the claimant, that a PAD application is a self-contained interim application entirely separate from the claim to which it relates. Additionally, it was argued that by depriving PAD applications of their value, the incentive for proper compliance with the pre-action protocol would be lost.

Rejecting those submissions LJ Briggs stated that ‘the plain object and intent of the fixed costs regime in relation to claims of this kind is that, from the moment of entry into the portal… recovery of the costs of pursuing or defending that claim at all subsequent stages is intended to be limited to the fixed rates...’ (para 31). Therefore, to allow costs to be summarily assessed would be to contradict what was originally intended by the introduction of the portal.

He did not consider a PAD application, in a claim for personal injury which was started within the portal, to be entirely separate from the main action but considered that they were in fact very closely connected. In his view a PAD application assisted the claimant in its preparation and, above all, contributed to early settlement before the issue of proceedings – which is the stated aim of the protocol.

The decision will no doubt be viewed by claimants as a further restriction of the advantages intended to be conferred on them by the protocol. Defendants should welcome this decision particularly as these applications can be quite common in, for example, assault claims where the amount of documentation can be quite extensive and the disclosure obligations onerous.